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UGI (UGI) Down 0.1% Since Last Earnings Report: Can It Rebound?

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A month has gone by since the last earnings report for UGI (UGI - Free Report) . Shares have lost about 0.1% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is UGI due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.

UGI Corp. Q4 Loss Narrower Than Expected, Sales Miss

UGI Corporation reported fourth-quarter fiscal 2020 adjusted loss of 14 cents per share, narrower than the Zacks Consensus Estimate of a loss of 33 cents. In the year-ago quarter, the company reported a loss of 37 cents per share.

It generated GAAP earnings of 5 cents per share for the reported quarter against the year-ago quarter’s GAAP loss of 27 cents.

Revenues

Revenues of $1,124.3 million for the fiscal fourth quarter missed the Zacks Consensus Estimate of $1,249 million by 10%. The top line also declined 2.3% from the year-ago figure of $1,150 million.

Segmental Revenues

AmeriGas Propane: Revenues of $398 million for the quarter under review were down 3.2% from the year-ago number.

UGI International: Revenues summed $401 million, up 2.6% from the year-ago figure.

Midstream & Marketing: Revenues of $230 million for the reported quarter fell 6.9% year over year.

UGI Utilities: Revenues of $129 million were down 3% from the year-ago reported figure.

Corporate & Other: This segment incurred a loss of $34 million, wider than the loss of $32 million in fourth-quarter fiscal 2019.

Highlights of the Release

AmeriGas Propane increased total investment in the LPG business transformation project to $200 million and the company expects to realize $140 million in permanent annual benefits by fiscal 2022-end.

UGI Utilities invested $348 million of capital, and added nearly 12,000 residential and commercial heating customers in fiscal 2020. This is likely to have a positive impact on the top line in fiscal 2021.

Total interest expenses of $75 million were down 1.3% from the prior-year figure.

Guidance

The company initiated its fiscal 2021 adjusted earnings per share guidance of $2.65-$2.95. The midpoint of the guided range is nearly 12% higher than UGI Corp.’s fiscal 2020 adjusted earnings per share of $2.67. The Zacks Consensus Estimate for fiscal 2021 earnings is currently pegged at $2.86 per share, which exceeds the midpoint of the above guided range.

UGI Corp. expects to invest $430 million in fiscal 2021.

How Have Estimates Been Moving Since Then?

It turns out, estimates revision have trended upward during the past month.

VGM Scores

At this time, UGI has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of this revision has been net zero. Notably, UGI has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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